Pursuant to a congressional request, GAO reviewed the Department of Energy's (DOE) Paths to Closure report, which details DOE's strategy to accelerate its hazardous waste cleanup efforts, focusing on the: (1) methodologies and assumptions used to develop the Paths to Closure report and any associated limitations; (2) uncertainties in the Paths to Closure report that may affect its usefulness; and (3) funding implications related to the cost of cleanup.

GAO noted that: (1) to develop the Paths to Closure report, DOE's Office of Environmental Management issued guidance in October 1997, requiring its field offices to develop, by project, estimates of the cleanup work to be accomplished, the schedule to be achieved, and total--or life-cycle costs--to complete the cleanup work; (2) the guidance also provided each field office with an estimated annual funding allocation for cleanup activities through 2006; (3) the Paths to Closure report is an improvement over previous efforts because, for the first time, DOE set goals for completing the cleanup at each site, used project-specific data in estimating cleanup costs, and surfaced issues needing resolution, such as where certain wastes will be disposed; (4) however, DOE headquarters did not specify a standard methodology to be used for estimating cleanup costs, leaving field offices to select their own approaches for developing their estimates; (5) as a result, the data from some of the sites may not be comparable or reliable; (6) DOE has some initiatives under way to improve data quality for the next Paths to Closure update; (7) a number of uncertainties regarding the information in the 1998 Paths to Closure report, particularly in the sites' cost and schedule estimates, affect the report's usefulness; (8) for example, many field offices based their cost estimates on assumed cleanup levels that have not yet been agreed to by the regulators involved; (9) if the levels eventually agreed to are stricter than assumed, both costs and schedules could increase; (10) DOE also faces a number of challenges to achieving its Paths to Closure goals at the $5.75 billion annual funding level target identified in the report; (11) the sites' estimates of their funding needs for fiscal years 1999 through 2006 exceed the funding level target by more than $4 billion, or by an average of about $500 million per year; (12) DOE's Paths to Closure guidance established cost reduction goals for each field office to help address this funding gap, but most of the sites GAO contacted had not identified specific strategies for achieving the cost reductions; (13) in addition, as GAO's past work has shown, DOE's projects tend to take longer and cost more than anticipated; and (14) moreover, if some of the cleanup activities that were assumed to be outside the scope of Paths to Closure are ultimately included in the Environmental Management program, costs would grow.